Home Savings & Loan v. Aetna Casualty & Surety Co.

The majority holds that there is a distinction between the phrase “discovery of loss” as it is used to determine coverage and “discovery of loss” as it used to trigger notice requirements. The majority thereby adopts a minority, if not a totally novel, interpretation of discovery bonds and demands a significant departure from current industry practices. I believe that, under the terms of the bond, Aetna is not liable to Home for any loss resulting from the dishonesty of Glad or the Armitage lawsuit. Any coverage for the loss arising from the Armitage lawsuit must be found under the F & D…